Pension Reform Act 2014: The Necessity For Writing A Will

Section 8(2) supra can thus be summarised as follows:
The balances in the RSA of a deceased employee can be accessed by his relations/beneficiaries through: A Will properly prepared by the deceased employee and probated, wherein all beneficiaries are clearly identified; letters of Administration duly procured and containing details of the contributors Retirement Savings Account and his/her assets; and application of the Native Law and Customs applicable to the deceased at the time of his death. This will be applied by the court in the absence of (i) and (ii).
Of the three options highlighted in section 8(2) supra, the option that is recommended is the need for employees contributing to pensions to write a Will detailing the names of the beneficiaries.

If the deceased employee left a Will, the PFA’s would then find it easier to submit the probated Will for approval of the Pension Commission. Once the Will is approved by the Pension Commission and approves release of the balances in the RSA, beneficiaries of deceased employees are therefore able to, within a few months of the demise of the employee, access the balances in the estate account.
The other options of either procuring Letters of Administration or application of Native Law and Customs of the deceased employee are expensive, cumbersome, takes time and/or are fraught with controversies. We therefore encourage all employees who currently contribute to pensions to consider writing a Will today. We also call on the Pension Commission and Pension Fund Administrators to encourage all employees to consider writing their Will immediately upon engagement as employees.

Key Takeaways

Section 8(2) of the Pension Reform Act of 2014 has made clear provisions on the modalities for dealing with pensions of deceased persons to the pension funds from being left unattended after an employee passes away. This stops false claims and unauthorised access while guaranteeing that only legitimate beneficiaries receive the RSA balance. Legal evidence, such as a valid will, a letter of administration, or a court order, is needed to verify the authenticity of the people claiming the money before any distribution is made. By guaranteeing that money is disbursed legally, this requirement preserves the integrity of the pension system in addition to safeguarding the interests of the deceased’s dependents.

Bunkaya Gana is the managing director/CEO of Greenwich Trustees Limited and can be reached on Bunkaya.gana@greenwichtrustees.com.